BYD to issue bonds to take a pay cut to less cost Wang bullet new energy industry chain

Take a pay cut again be part of the staff that is disguised layoffs. But another part of the staff is indifferent look to take a pay cut, workplace like a professional player in the NBA, always leave, or leave work dedicated, but do not put all your chips pressure (BYD) in which you fry it or speculation that you have the power. "

This is the second in August last year to take a pay cut, BYD second large area to take a pay cut. BYD increasing financial pressure due to the continued downturn in automotive business. But this time, BYD President Wang still adhering to build their own new energy industry empire.

2010 BYD before the crisis, the development of new energy plan that led to the new energy vehicles, solar power plants, energy storage power station, the whole industry chain is very long. "To ensure the chain run, need to make money, like two years ago in the traditional automotive business like other business 'transfusion' but BYD only the preparatory run funds rely on other means." An industry analysts say.

Downturn in the automotive business

BYD's pay cut file, June-September 2012 performance bonus cut follows the amount of A-level performance awards GB level, H, and operatives Performance Award amount unified lowered to 15%.

According to the 2011 BYD report shows that wages and salary expenses of an employee of the company a total of 69 billion, does not take into account additional factors, BYD pay about 17 billion in June to September. Securities analyst, said: "a 14% reduction in staff salary income, BYD through a pay cut to save human cost of 240 million yuan."

BYD executives to take a pay cut explanation: due to external economic environment is not optimistic about the effectiveness of the company appears relatively large decline, in particular, occupy 48% of the entire business of the automotive business is desired delay. According to the China Association of Automobile Manufacturers statistics, from January to May this year, BYD car sales of 176,700, down 11.56 percent compared with the same period last year of 199,900.

July 2, a Guangzhou BYD dealer told reporters that this year the situation is very bad, the situation in the first quarter continues, "The good times can be sold for more than 130 vehicles a month, and sometimes even a little more past six months is this situation. "

Own brand market share is still in decline, the market share of 40.3% in May of this year, a year-on-year decline of 3.3 percentage points. "The overall trend will continue for a dealer now, especially self-brand dealers

Sad day. Secretary-General of the Guangzhou Automobile Sales Association Xiongshuang Ling said. Bear investigation in the Guangzhou market dealer inventory generally high level of dealer inventory to 1.2 months, under normal circumstances, but many dealers have more than two months, some distribution and even up to 3 months.

Above BYD dealer did not disclose the amount of its inventory, but he also said that almost all of its own brand dealers face inventory problems, "in the case of the market is not good, the dealer should also consider giving manufacturers some of the pressure."

Dealer pressure actually been transferred to the BYD, according to a sources close to BYD said: "the BYD's cash flow increasing pressure because of sluggish sales dealer."

BYD, the performance has been a continuous decline. The 2011 BYD deducting non-recurring gains and losses net profit of only 629 million yuan, down Qicheng. The first quarter of this year, BYD single-quarter net profit of only 27 million yuan, a year-on-year decline of up to 90%, forecast from January to June this year, net profit attributable to shareholders of listed companies declined by 75% to 95% over the same period last year.

June 20, BYD officially issued 30 billion 5-year bonds to raise funds to be used to repay bank loans, restructure corporate debt, to complement the company liquidity.

BYD said the proceeds of the offering to be 15 billion to repay short-term bank borrowings; remaining 15 billion intended to be used to supplement the company's working capital, of which 13 billion for automobiles and auto parts, R & D, production and manufacturing, and another 200 million Yuan plans to invest in Huizhou BYD battery.

Automobile and new energy industry chain wants

Denied Once WangChuanFu completed the envisaged new energy industry chain layout, BYD will monopolize the entire value chain of China's new energy production, supply and research, the funding pressures WangChuanFu, did not waver in its whole industry chain plans to build new energy.

Data from the public point of view, the crisis BYD does not shrink the wishes of the business.

However, its net profit was a significant decline. Its net profit in the last three years were 3.794 billion yuan, 2.523 billion yuan and 1.385 billion yuan, down 33.48% and 45.13% after two years. Mainly due to the downturn in the automotive business, while promoting large-scale in the year 2010, the new energy industry chain, does not bring significant benefits for BYD.

BYD Annual Report 2009, net profit of 3.794 billion yuan, up 271.46 percent surge. BYD radical expansion, four seeking acquisition targets, the success of which include beauty Sunshine Bus, a battery company in Ningbo, mold factory in Japan, Zabuye lithium industry, was also interested in acquiring a number of companies, including Alcoa lightweight automotive parts business.

In addition, Wang Chuanfu start building the new energy industry chain. Around 2010, BYD said its new energy strategy radiation emerging industry, from wind power to solar. Industry chain extended from ore, industrial silicon, high purity silicon, polycrystalline silicon, sliced, module installation, solar power station, solar power station battery compensation.

In December of that year, BYD to invest 1.2 billion yuan to establish LED production base in Huizhou layout. "Through the use of BYD iron battery technology, BYD solar LED street lights has inherent environmental advantages."

The individual this expansion of industry selection criteria may be based on the needs of the "village" building of the the BYD Tsuboyama base. "Future village rooftop solar power installations, as well the hut seventy-eight wind turbines produce energy, energy storage and conversion, through the energy storage power station to meet the electricity demand in the buildings and the travel required for electric vehicle charging electricity.

BYD own production of the residential solar power generation device, the silicon material required for wind turbines, energy storage power plants, water purification devices, as well as the building itself and the production of solar battery panel.

Despite the recent two years BYD encountered the main business dilemma, but individual this does not stop these needs "blood transfusion" business. In the beginning of this year, BYD Zhangbei County, Hebei Province, built a set of wind power, solar photovoltaic power generation, energy storage and smart transmission of battery storage power station with a total investment of 120 billion yuan.

In the individual this view, the major business segments of the new energy industry linkage first lies in the integration of the R & D side, electric car battery technology can be applied to the solar cell phone technology can also be applied inside. "But it all depends on the car business whether 'the second take-off'." Said industry analysts said.